🧐 ProPicks AI October update is out now! See which stocks made the listPick Stocks with AI

Forex - GBP/USD hits 1-week lows after BoE decision, U.S. data

Published 12/05/2013, 10:25 AM
GBP/USD
-
EUR/GBP
-
Investing.com - The pound slid to one-week lows against the U.S. dollar on Thursday, after the Bank of England held its monetary policy and as strong U.S. economic reports supported demand for the greenback.

GBP/USD hit 1.6307 during U.S. morning trade, the pair's lowest since November 28; the pair subsequently consolidated at 1.6319, shedding 0.40%.

Cable was likely to find support at 1.6198, the low of November 27 and resistance at 1.6442, the high of December 2 and a 27-month high.

Earlier in the day, the BoE’s monetary policy committee voted to leave rates on hold at 0.5% and made no changes to the GBP375 billion quantitative easing stimulus package.

The announcement came after U.K. Chancellor of the Exchequer George Oborne said, in his Autumn Forecast Statement, that "Britain's economic plan is working", and he raised growth forecasts to 1.4% this year and 2.4% in 2014.

Meanwhile, the dollar found support after the U.S. Commerce Department said gross domestic product increased at a seasonally adjusted annual rate of 3.6% in the three months to September, above expectations for growth of 3.0% and up from a preliminary estimate of 2.8%.

Separately, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 23,000 to a seasonally adjusted 298,000, from 321,000 in the previous week whose figure was revised up from 316,000.

Analysts had expected initial jobless claims to rise to 325,000 last week.

Official data also showed that U.S. factory oders fell 0.9% in October, less than the expected 1% decline, after an upwardly revised 1.8% increase the previous month.

Sterling was lower against the euro, with EUR/GBP advancing 0.83% to 0.8367.

Also Thursday, European Central Bank President Mario Draghi said that the bank's policy stance was to remain accomodative for as long as necessary and that key interest rates are likely to remain at current or lower levels for an extended period of time.

Speaking after the ECB's monthly policy meeting, Mr. Draghi added that the euro zone could experience a prolonged period of low inflation before the rate moves upwards close to the 2% target.

The ECB president also the bank held 2013 growth expectations at -0.4% and raised the 2014 forecast to 1.1% expansion from 1%.

The comments came after the ECB held its benchmark interest rate at 0.25%, as expected.


Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.